Outstanding loans of commercial banks, net of banks’ reverse repurchase (RRP) placements with the BSP, increased at a slightly faster pace in March— rising by 18.7 percent from the previous month’s expansion of 18.0 percent. The growth of bank lending inclusive of RRPs also increased at a faster pace of 17.7 percent from 16.1 percent in February. Commercial banks’ loans have been growing steadily at double-digit rates since January 2011. On a month-on-month seasonally-adjusted basis, commercial banks’ lending in March rose by 2.1 percent for loans net of RRPs and 2.7 percent for loans inclusive of RRPs.
Loans for production activities—which comprised more than four-fifths of banks’ total loan portfolio—grew by 19.3 percent in March from 18.4 percent a month earlier. Meanwhile, the growth of consumer loans decelerated to 18.5 percent from 20.3 percent in the previous month due mainly to the slowdown in auto loans and credit card receivables.
The expansion in production loans was driven primarily by increased lending to wholesale and retail trade (by 58.0 percent); manufacturing (35.0 percent); real estate, renting, and business services (25.1 percent); financial intermediation (32.1 percent); electricity, gas, and water (21.6 percent); public administration and defense (41.2 percent); transportation, storage, and communication (16.9 percent); and construction (38.4 percent). Meanwhile, declines were observed in lending to mining and quarrying (-28.7 percent) and agriculture, hunting, and forestry (-44.9 percent).
The sustained growth of bank lending is expected to support real sector activity in the months ahead amidst an uncertain global economic environment. Going forward, the BSP will continue to monitor economic developments to ensure that the monetary policy stance remains consistent with the price stability objective and supportive of non-inflationary growth.